“Grown Up” Risk Management Strategies Create Wealth For Business Owners

Entrepreneurial thinking and enterprises have created tremendous wealth in the United States, fueled upward mobility, expanded the middle class and provided a standard of living that would have been unimaginable to America’s founders.  This same entrepreneurial spirit gave rise to captive insurance companies as enterprising businesses looked for a better approach to manage risk.  In their early days, captives were primarily used to control insurance costs and ideally return a portion of premiums paid for insurance back to the parent company.

Beginning in the mid-80s, many businesses continued down an entrepreneurial path and shifted their mindset from risk management simply as a form of cost containment to risk management as a profit center.  Indeed, a “grown up” approach to risk management can be quite creative and entrepreneurial.  Making a paradigm shift from viewing risk management purely as a cost center to viewing risk management as a profit center and strategic pillar of the business can be very rewarding from a financial standpoint.         Continue Reading